by M.K. Matthews
Cue up Marvin Gaye’s iconic hit, “What’s Goin’ On.”
I woke up to find that the tariff situation between China and the US is wreaking havoc on the world markets. To recap yesterday, the market struggled and yoyo-ed but closed at a very modest increase after the losses of the prior day.
This morning that is no longer true. As I type this the European markets are down, Asia is down, and closer to home, the US markets are diving in the Futures Market. The dollar is down. The US market hasn’t opened yet but analysts are predicting a 500 point drop today.
Here are the things to watch today.
I will try to sort through and offer you clarification. Here are some articles to check out on this topic:
- All 30 Dow stocks drop, led by Boeing
- Dollar declines as China slaps tariffs on $50 billion worth of U.S. products
There is a tit for tat between China and the US regarding tariff threats that are escalating daily and could continue through the summer. The latest round of tariffs could go into effect as soon as next month. This will have a dampening effect on the market until this lobbing of financial bombs is sorted out.
As it stands today, China is threatening as much as a 25% tariff on 106 American products from airplanes to soybeans. How could something as small as a single soybean affect the markets and subsequently your wallet? How could a single soybean affect global currencies? Market Watch explains:
- U.S. soybeans would be China’s biggest weapon in a trade war
- China threatens U.S. cars, planes and soybeans with tariffs in response to Trump
For those of you currently invested in stocks, I’m sure you are wondering how you could be affected. The broad reach over the various segments of the market are not going to offer many safe harbors, even if invested in a broad-based mutual fund. Again, Market Watch has some answers.
There’s bad news even if you AREN’T an investor.
Do you have indigestion yet?
There is more bad news to consider and that is how it will affect your health and healthcare.
A vast array of US pharmaceuticals ingredients are created in China. As those prices rise so will your costs. Some of the areas that we know of so far are vaccines, insulin products, medical devices from MRI’s to surgical tools, with an especially heavy impact on generic medications.
Why generics, you ask? Name brand drugs do the heavy lifting by underwriting through sales the research and testing while generics costs are borne more heavily by the manufacturer in the generics market.
As I look at the clock right this minute, the US Stock Market will open in five minutes. I will leave you with what some analysts are foreseeing for today. You will also find some information as to what happened overnight across the pond
- Here’s how the China-U.S. ‘trade skirmish’ could become a global ‘trade war’
- 5 charts that show how China’s response to U.S. tariffs is rattling markets
- Dow poised to drop as analysts fret about trade fight’s “dark shadow”
Meanwhile, across the pond…
Things aren’t looking good there, either.
- Italy raises budget deficit after bank bailout
- European stocks fall as China pulls out ‘big guns’ against U.S. tariffs
- Eurozone inflation rises after months of declines
To lift a quote from one of my favorite Bette Davis movies, “All About Eve“,
“Fasten your seatbelts. It’s going to be a bumpy night.”
And THIS is one of many reasons to be prepared. It will hit us in the pocketbook whether we have invested in the market or not.
Stock market started down 500 and ends up over 200… Yep, no behind the scenes intervention here folks, nothing to see here.
No way actual trading sediment changes that quickly in a single day’s trading session..
Thank you for the “heads up” on the upcoming tariffs. Will check the list and stock more of items that we use.